9911796707
TMI Blog1978 (2) TMI 221X X X X Extracts X X X X X X X X Extracts X X X X ..... is the said notice. In order to understand the rival contentions, it will be necessary to mention the following facts. 2A. Prior to 1st April 1960 the appellants had been provided with metering equipment consisting of current transformers of the ratio of 40 : 5 on the basis of the appellants' then connected load which was 485 KW with an authorised maximum demand of 210 KW. The said metering equipment recorded direct reading of the energy consumed on the dial provided for that purpose. At or about that time the appellants had placed an order with the Government Electric Factory, Bangalore, for the supply of 1000 KVA transformer to feed the appellants' new automatic plant imported by them which had been erected for the appell-ants by the General Electric Company, Bombay. On 8th April, 1961 the appellants by a letter to the B.E.S.T. Undertaking informed them that the appellants desired a shut-down of the power supply to their factory with a view to enable the appellants to connect their new (1000) KVA transformer. On 13-4-1961 one H. B. Shivdasani, a representative of the appellants, called on the Superintendent of the B.E.S.T. Undertaking with a view to finalise the arrang ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aking by way of a reminder, in which for the first time disconnection of supply for non-payment was hinted at. On 31st May 1972 the appellants recorded their surprise at the claim made in the Undertaking' s letters dated 4th and 24th May 1972. It was claimed in this letter that the appellants were not aware of the replacement of the meter. The appellants further contended that the threat to discontinue supply was uncalled for. The appellants sought time and facility to check the calculations made by the B.E.S.T. Undertaking and to confirm the amounts claimed. It was also pointed out that the appellants had based their costing on the electricity bills sent by the B.E.S.T. Undertaking which had been duly paid and they would not be entitled to recover the supplementary fabrication charges from their customers, which would entail great loss. The B.E.S.T. Undertaking sent a detailed reply by their letter dated 13th July 1972 in which the facts set out earlier in this judgment were briefly and chronologically indicated. This was followed by a reminder dated 25th Aug. 1972. By their letter dated 4th Sept. 1972 the appellants mentioned that they were unable to check up their earlier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 61 to 31st Dec. 1971. The contention of the appellants that the whole of the claim was barred by the law of limitation was also brought to the attention of the Electrical Inspector. This correspondence was followed by the petition filed on 13th Nov. 1972, in which it was inter alia, repeated (para 11 (d)) that the whole claim of the Undertaking was barred by the law of limitation. 3. Before the learned trial Judge at the time of hearing of the application for interim relief, a consent order was made on 19th Feb. 1973 by which the Electrical Inspector to the Government of Maharashtra was appointed as a Referee to inspect the electric meter installed by the B.E.S.T. Undertaking bearing No. 546017 and the C.T. and the P.T. connected thereto in the premises of the appellants, and he was required to report whether the type of the equipment was such that the units recorded by the meter had to be multiplied by 2 (two) in order to arrive at the actual consumption of electrical energy. On 28th Feb. 1973 the report of the said Inspector was received and in the report it was, inter alia reported that it had been established that the meter under (sic) was geared for half the ratio for direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly who makes an application for such supply. Sections 22A and 22B confer power on the State Government to give directions to a licensee in regard to supply of energy to certain class of consumers, and the latter section confers power to control the distribution and consumption of energy. Section 23 prohibits the licensee from showing undue preference to any person in making any agreement for the supply of energy. We then come to Section 24 which is extremely material for our purposes and may therefore be fully set out; it reads as follows:- 24. Discontinuance of supply to consumer neglecting to pay charge- (1) Where any person neglects to pay any charge for energy or any sum, other than a charge for energy, due from him to a licensee in respect of the supply of energy to him, the licensee may, after giving not less than seven clear days' notice in writing to such person and without prejudice to his right to recover such charge or other sum by suit, cut off the supply and for that purpose cut or disconnect any electric supply-line or other works, being the property of the licensee, through which energy may be supplied, and may discontinue the supply, until such charge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or quantity: Provided that before either a licensee or a consumer applies to the Electrical Inspector under this sub-section, he shall give to the other party not less than seven days' notice of his intention so to do. ...... ...... ...... 8. It was urged on behalf of the appellants that Section 24 of the Electricity Act provided an alternative drastic and penal remedy or method which may be followed by a licensee in preference to or by way of an alternative to filing a suit. It was submitted that such a provision should be strictly construed and the construction which was submitted for our acceptance was that by such coercive method or power of withholding electric supply, the licensee ought not to be allowed to recover old or stale claims going back over a period of ten years when it was obvious that such claims could not have been recovered by the licensee fully by means of an ordinary civil suit. For the purposes of this argument concentration was lavished on the phrases neglects to pay and charge or sum due from him , and it was submitted that an amount, the recovery of which was barred by the law of limitation, could not be properly regarded as ' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the licensee the amount owed by that consumer to the licensee. 10. The learned trial Judge referred in connection with this branch of the argument to a decision of our High Court in Ramrao Raoji Palkar v Amir Kasam Bhagwan, (1956) 58 Bom LR 284, where a Division Bench of this Court had occasion to consider the provisions contained in Section 12 (3) (b) of the Bombay Rent Act. The words which were being considered by the Division Bench were ' rent then due' occurring in Section 12 (3) (b) of the Bombay Rents, Hotel and Lodging Bouse Rates Control Act, 1947. In the judgment Chainani J. (as he then was) who spoke for the Division Bench considered several meanings of the word ' due' to be found in Webster' s and Murray' s Dictionary, in Wharton' s Law Lexicon and Stroud' s Judicial Dictionary as also in other decisions and observed as follows : The word ' due' is, therefore, used in two different senses. In some statutes it has been held to mean all moneys owed or payable, even though their recovery may be barred by the law of limitation. In other statutes, a more restricted meaning has been given to this word and that is, moneys legall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is power of granting relief against forfeiture. It was further submitted that where such relief was required to be granted, the provision had to be construed in the manner in which it had been done, giving or adopting the wider meaning for the word ' due' as to be inclusive of all amounts due to the landlord including the amounts which were barred by the law of limitation inasmuch as it was a discretion to be exercised in favour of the tenant. It was submitted that there was no warrant for adopting any such construction for Section 24 of the Electricity Act. It would appear to us that Section 24 has to be properly appreciated in the context of the obligations cast and the restriction placed on the licensee under the provisions of the Electricity Act, which we have earlier referred to. Within the supply area the licensee is obliged to supply electricity on an application to any consumer and cannot discriminate between one consumer and another. The licensee is also obliged to follow certain directions given by the State Government as also made subject to the power of the State Government to control the distribution and consumption of energy within the area of the licence. Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch considerations being applied to the licensee' s right of discontinuance of supply for non-payment of the amounts owed to the licensee. The provision contained in Section 24 (1) which enables the licensee to discontinue electric supply to a particular consumer is mainly by way of relieving of the licensee of the obligation on him to be found contained in Section 22 viz. to make supply of electricity on application to all consumers within the area of supply. Once the proper position is perceived, then there is no warrant for obliging the licensee to go on supplying electricity to a consumer who has not paid the amounts in respect of the supplies made to him in the past on the ground that if the licensee were to file a suit, the claim or part thereof would be barred by the law of limitation. The provision in our opinion, would clearly warrant the wider meaning to be given to the word ' due' rather than the narrower meaning, as the wider meaning would be more in accord with the scheme of the statutory provisions under consideration as also with commercial honesty. 14. In this connection our attention was drawn repeatedly by counsel for the appellants to the policy und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... licensee. 16. This brings as to a consideration of the other branch of the argument, which was that there was no neglect on the part of the consumer i. e. the appellants to pay the charge claimed by the licensee i.e., the Undertaking and, therefore, action under Section 24 of the Electricity Act was not warranted. In connection with this branch of the argument our attention was drawn to several authorities, to which reference may now be made. 17. Counsel for the appellants drew our attention to several authorities both of the other High Courts and of the Bombay High Court and we shall first discuss three decisions of the Bombay High Court, one of which is unreported. The first of these decisions is Corporation of the City of Nagpur v. Nagpur Electric Light and Power Co. Ltd., AIR 1958 Bombay 498. In the said decision a dispute had arisen between the licensee company and the Nagpur Corporation concerning the supply of electricity by the company to the Municipality, which was, according to the municipality by reason of the large difference between the consumption set out in the bills for public lighting submitted by the company and the consumption which was actually recorded i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on Clause 30 of the agreement between the parties. According to the Division Bench, Clause 30 was nothing but a corollary to the liability created between the parties under Clause 20. It was contended on behalf of the consumer that even if the consumer' s interpretation of the agreement was incorrect and his contention as to the invalidity of the claim made by the licensee appeared to the Court as unsound, there was in fact a bona fide dispute between the parties when the consumer failed to pay for the supply of energy and if there was such bona fide dispute, the cutting off of the supply was unjustified. The Nagpur Corporation' s case was considered and the view, that action under Section 24 would not be justified when there is a bona fide dispute between the parties i.e. the consumer and the licensee, appears to have found favour with the latter Division Bench also. 19. Our attention was also drawn by counsel for the appellants to an unreported decision of a single Judge of this Court (K. K. Desai J.) given in Misc. Petn. No. 167 of 1967 (decided on 21-6-1972) (Bom), where the licensee had called upon the consumer to pay the amount of ₹ 17,552.17 after a lapse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingh v. Municipal Committee, Amritsar, AIR 1938 Lahore 338. It was submitted that what could not be recovered by a suit was being sought to be recovered from the consumer by the threat of disconnection. It was urged that if the consumer resisted the demand on the footing that the claim or a large part thereof was barred by the law of limitation (apart from raising other disputes), the consumer must be regarded as disputing the claim bona fide and therefore cannot be held to have neglected to pay the charges demanded. It was submitted that in these circumstances the licensee was not entitled to threaten to discontinue the electric supply. 21. It is true that in the two reported Bombay judgments the power of the licensee under Section 24 has been referred to or described as a drastic power and the Court has required strict compliance with the provisions of sub section (1) in order to uphold the threat given by the licensee. Although the consequence of non-supply of electricity to the consumer may be serious, particularly for a consumer such as the appellants it must be borne in mind that this cannot be regarded in the same manner as or equated with penal or taxing provisions of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r when the consumer ought to have been aware that a part of the claim of which a full statement was explained was patently and obviously within time. What then must be the reason why the entire claim was characterised as barred by the law of limitation? The reason must be to allege sub-sequently that there is a dispute and to contend that since there was a bona fide dispute the electric supply could not be disconnected. We have a somewhat curious situation here. Detailed explanations are sent by the Undertaking explaining the basis of its claim; in reply the letter containing the explanation is characterised by the consumer as containing irrelevant allegations. It is obvious that the whole claim cannot be time barred and a part of the same at any rate must be within time; the consumer describes the whole claim as time-barred. When to this is added the entirely frivolous discussion regarding the replacement of the meter, which is not what was claimed by the Undertaking but something totally different which was fully explained by the letter of 13th July 1972, we are forced to conclude that the dispute raised on behalf of the consumer was neither proper nor bona fide. It is true that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time-barred but rather that the entire claim was time-barred. 23. We are, therefore, of opinion that both the conditions required for the licensee to take action under Section 24 (1) of the Electricity Act are satisfied; these are: that there was a debt due from the appellants to the licensee and that the appellants had neglected to pay the amount which was owing. If that is so, the impugned notice dated 31st Oct., 1972 cannot be characterised as contrary to law. It would follow that the same is not required to be quashed as alleged or for any other reason. 24. Even as regards the objection to the claim for deposit made by the licensee, it would seem that the attitude of the licensee was in accord substantially with the statutory provision to be found in the Proviso to Section 24 of the Electricity Act. This may be a minor indicator of the attitude of the consumer. However, our opinion of the nature of the dispute raised by the appellants in the correspondence is not based only upon the refusal to make any deposit but on various other factors indicated earlier in this judgment. We have already dealt with the contention raised on behalf of the appellants on the provisions con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ments appear to us to be ones which deserved to be rejected as was done by, the learned trial Judge. 26. It may be further mentioned that two amendments were sought to be raised on 8th March 1973 and in the second amendment by the addition of para (e-ii) new allegations pertaining to the purported practice of the 1st respondents were sought to be made. The practice pertained to claim for non-residenttial tariffs, and the letter, Exhibit D-1, which was part of the amendment sought, would seem to indicate that this was a matter totally extraneous to and different from the type of claim before us. Apart from other considerations, the amendment sought for by adding para (e-ii) and Exhibit D-1, which would also have required an affidavit in reply, would appear to be totally useless and irrelevant, and on this ground also the said amendment could have been disallowed. 27. The second amendment was sought for on 12th March 1973 i.e. after a full day' s hearing of the petition. The further amendment sought also seeks to raise the contention that the provisions of the Electricity Act are violative of Article 14 of the Constitution inasmuch as there are two remedies provided to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts deposited by the appellants also is ordered to be paid over to the respondents' advocate. 31. The Prothonotary will make this payment on the minutes on the usual undertaking given by the advocate for the respondents. 32. Mr. Parekh applies orally for leave to appeal to the Supreme Court and submits that the following two questions may be regarded as important questions arising from this judgment of public importance which would require settlement by the Supreme Court. 1. Whether on a true construction of Section 24 of the Indian Electricity Act, 1910, the words ' neglects to pay' would include omission to pay or refusal to pay a time-barred claim? 2. Whether on a true and proper construction of Section 24 of the Indian Electricity Act, 1910, the word ' due' includes time-barred debts or excludes time-barred debts? Mr. Singhvi opposes. PER COURT: 33. Leave to appeal to the Supreme Court granted as, in our opinion, the two questions submitted by counsel for the appellants would seem to raise substantial questions of law of general importance which in our opinion are required to be decided by the Supreme Court in view of the nature of the statu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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